Few things have the power to completely ruin your day quite like a call from a debt collector. Although you may be tempted to hang up the phone and try to forget the call ever took place, doing so is a mistake. Even if you’re certain you don’t owe the debt, you must take steps to protect yourself from a debt collection lawsuit. Should the collector sue you and win, it can request that a judge enforce a bank account garnishment against you. This gives the collector the ability to withdraw money directly from your bank accounts to cover the debt you owe. Fortunately, you can take action to protect yourself – regardless of whether or not the debt the collector claims you owe is legitimate.
One surefire method of avoiding a bank account garnishment is to pay the debt the collector claims you owe. If you know the debt is legitimate, paying it off is the quickest way to solve the problem, protect yourself and preserve your bank balance. If you choose this route, make sure to request that the collection agency send you a receipt for your payment and a zero balance statement. These items serve as proof that you paid the debt in the event another collector calls you in the future attempting to collect the same debt.
Ask for Validation
Regardless of whether or not you owe the debt, federal law requires the debt collector to prove that you owe it. The Fair Debt Collection Practices Act gives all consumers the right to request validation from debt collectors before submitting a payment. This ensures that you’re paying a real collection agency for a real debt. The collection agency cannot take any action against you – including a lawsuit and bank account garnishment – until it proves the debt is yours. Collection agencies sometimes make mistakes and pursue the wrong consumer for a debt. If you suspect the account isn’t yours, requesting validation can prevent legal problems down the line.
Respond to a Summons
Collection agencies sometimes threaten to sue in an effort to scare consumers into making quick payments. If you receive a court summons in the mail, however, watch out. A court summons indicates that the collector has already filed a lawsuit against you. Depending on your state, you have a limited amount of time to respond to the summons before the court sides with the collector by default. A default judgment can quickly turn into a bank account garnishment. Declaring your intention to appear places the burden of proof on the collector. If the collector cannot provide documentation supporting its claim, it has no choice but to drop the case.
Prepare a Defense
If a hearing date has already been set, you must prepare a defense against the collection agency and present it to the judge. One example of a valid defense is the statute of limitations. The statute of limitations for debt collection is the amount of time any creditor has to file suit against a debtor for payment. If the statute of limitations in your state has expired, this defense protects you from a judgment – even if the debt is legitimate. While you don’t have to hire an attorney to plead your case, it is wise option if you can afford to do so.
- U.S. Department of the Treasury: Answers About Garnishments
- Federal Trade Commission: The Fair Debt Collection Practices Act (Section 809/p.11,12)
- Neighborhood Economic Development Advocacy Project: The Basics of Defending Creditor Lawsuits
- Federal Trade Commission: Time-Barred Debts – Understanding Your Rights When It Comes to Old Debts
Ciele Edwards holds a Bachelor of Arts in English and has been a consumer advocate and credit specialist for more than 10 years. She currently works in the real-estate industry as a consumer credit and debt specialist. Edwards has experience working with collections, liens, judgments, bankruptcies, loans and credit law.